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  • Home-Buying Made Simple

    Thinking about buying a home can be intimidating. What you might not know is there are a couple steps that can help you get the most out of your money and even expedite the purchasing process.

    Stay Put
    Even if the idea of buying a home is in the beginning stages, it’s wise to keep your money right where it is. Making large purchases or moving money around right before buying is discouraged. This is so you show a solid, dependable credit score. Your Guaranteed Rate loan officer wants to provide you with the best loan possible, and having firm credit will help.

    Get Pre-Approved
    Don’t be mistaken – just about anyone can get pre-qualified, but getting pre-approved means your financial information has been reviewed and you have been approved for a home loan. Your Guaranteed Rate loan officer will also let you know how much you can afford and how much they can lend you. Attaining pre-approval will save you time and energy when looking at homes so you can narrow your choices down to homes you know you can afford.

    Bigger Isn’t Always Better
    Your home will increase in value only as much as the other houses within the same neighborhood. Remember your appreciation value will be limited if your new home towers over the homes of your neighbors. The largest homes on the block attract a small audience, and you won’t want to limit potential buyers if and when you resell. Usually, the bigger the home, the greater the sleeper costs like property taxes, HOA dues and utility bills. Budget not only according to the mortgage cost, but with these costs in mind as well.

    Instinct over Emotions
    Even though your emotional side might fall in love with a home, your instinctual side shouldn’t forget about the logical and financial aspects of home buying. Your instinct should tell you that you’re getting a great house for a great value, whereas emotions might be concerned with paint colors and where the family photo will hang. Buying a home is an investment, not a relationship.

    Inspection is Key
    Hiring a home inspector may cost a few bucks ($200 on average), but you might end up saving thousands. A home inspector will provide you with information that can help you decide whether or not you should buy the home in question. For example, if the inspector finds cracked or damaged foundation you can use it as a bargaining tool to lower the price of the home. It’s easier to spend a small amount upfront for an inspection than to find out later you have to spend a fortune on your new home. Inspection should be considered one of your home buying costs.

    Know how to Bid  
    An opening bid should be based on your answers to the two following questions; 1. What can I afford? 2. What do I believe this property is worth? Your bid should be fair and reasonable to both you and the seller. Do your research within the neighborhood to see how much other homes in the area have sold for recently.

    Check out the Neighborhood
    Pass through the area morning, noon and night in order to familiarize yourself with the ways of the neighborhood. Take your daily commute to work, the grocery store and the soccer field from the house to make sure it’s something you can handle. Even if you don’t have children, you should still research the neighborhood schools because it affects home value greatly since a well-esteemed school district can increase the value as much as 20 percent.

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    Oct 27 2010